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Status: 10/04/2022 4:29 p.m
Chinese experts say their country will overtake the US as the world’s largest economy by the end of the decade. But how meaningful are the statistics anyway?
The Chinese economy is no longer growing as fast. China will not achieve the self-imposed goal of 5.5 percent growth this year by the communist state and party leadership. The strict corona measures in the country with lockdowns in at least 45 cities in recent months have severely weakened the economy. In addition, there is an ongoing crisis in the real estate industry, which has been a major driver of the Chinese economy so far.
“No matter how much they fear China”
Despite this, the Chinese expert Victor Gao, who often broadcasts government opinions on Chinese state television, is convinced that the People’s Republic could possibly surpass the USA as the world’s largest economy as early as 2027. It will be there by 2030 at the latest. “I think that China is the largest economy in the world, which is normal because China has a large population,” Gao explains his thesis.
“China’s population is more than four times that of the United States,” Gao said. “No matter how much Americans hate China, no matter how much they fear China, China will certainly advance economically and surpass the US economically.”
The British think tank Center for Economics and Business Research assumes that China will not overtake the USA before 2030 at the earliest. Two years ago, the experts still considered the year 2028 to be likely.
question of prestige
Other experts think it is unlikely that China will ever become the world’s largest economy. For example, Michael Pettis, professor of finance at Beijing University. “If you look at the historical precedents, you see again and again that this growth model creates very rapid growth and then sets inflated expectations. And those expectations are never met,” Pettis said.
So China is not the first country to aim to become the world’s largest economy within 20 years. People forget that. In the 1960s, everyone assumed that the Soviet Union would become the world’s largest economy in the 1980s. Everyone assumed that Japan would overtake the United States within a few decades. And of course that didn’t happen.
The reason: “unhealthy” growth, which Pettis also sees in China. He considers the quality of growth to be more important than the size of the gross domestic product. Researchers around the world are discussing how meaningful the rankings based on gross domestic product actually are. It is doubted that much will change if China replaces the USA as the world’s largest economy on paper. At most it is a gain of prestige that is at stake.
China vs. USA: Can China’s economy really overtake the USA?
Eva Lamby-Schmitt, ARD Shanghai, October 4, 2022 2:44 p.m